Model Closing Opinion Letter (Annotated) - American Bar Association

2 Model Closing Opinion Letter (Annotated)
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content of filings and as to other action in effect at the time of
filing. 8 See Pa.Op.Report Part I, Section 1A.
When the corporate record is incomplete, the Opinion Giver
may be able to rely upon the Presumption of Regularity and
Continuity: TriBar Report § 6.1.1; ABA Guidelines 3.3. (See
optional paragraph (E)(8), p. 108, below.)
(2) Duly Organized. The concept “duly organized” includes
the idea that the corporation was “duly incorporated” and that
it thereafter adopted bylaws, elected directors, and authorized
the initial issuance of stock, if organized on a stock basis. These
determinations will require that the Opinion Preparers examine
the corporation’s records, including minute books. See
Pa.Op.Report Part I, Section 1B.
(3) Existence as a Corporation; “Status” Opinion. To state
that the corporation is validly 9 existing (or subsisting) 10 confirms
that corporate existence has begun and that the corporation
has not been dissolved, ceased to exist, or undergone any
organic change that would affect its ability or authority to consummate
a transaction. See Pa.Op.Report Part I, Section 1C.
In credit transactions, the short Opinion as to corporate existence
should address the concerns of the Opinion Recipient, and
is preferred as being precise and cost-efficient. In certain other
8. If the review to determine compliance in all material respects with statutory
requirements reveals a discrepancy, it may not be possible to give
the Opinion regarding due incorporation. See Glazer §§ 6.2 and 6.3. The
Pennsylvania Business Corporation Law of 1988 (B.C.L.) § 1302 provides
that a natural person must be “of full age” (defined in § 1103 to
mean 18 years) to be an incorporator. In reliance upon the unstated
assumption that natural persons have the required legal capacity (see
item 1 of the note to Assumption (B)(4), page 96, below; TriBar Report
§ 2.3(a)), the Legal Opinion Committee believes that under customary
practice in Pennsylvania, absent Actual Knowledge, it is not necessary
in giving the Opinion to ascertain the ages of the incorporators.
9. The TriBar Report states in section 6.1.3 note 113 that, as a matter of
customary usage, the omission of the word “validly” is understood not to
change the meaning of the Opinion.
10. As noted in footnote 6, above, “existing” and “subsisting” are deemed to
be synonymous.